'Ready to fight till end': China prepared for US trade war

BEIJING: In light of the raging trade war initiated by the United States, the Chinese Embassy in the US on Wednesday proclaimed that it was "ready to fight till the end" in the war. 

Major Asian markets traded up on Wednesday, reversing their losses a day after US President Donald Trump imposed more blanket tariffs on Chinese imports following a similar move last month.

US tariffs are expected to hit hundreds of billions of dollars in total trade between the world's two largest economies.

“If war is what the US wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” the Chinese Embassy in the US said in a post on X.

The embassy was replying to a post made by spokesperson of the Chinese Ministry of Foreign Affairs where it blasted US' decision to raise tariffs on Chinese imports over the fentanyl crisis, "The fentanyl issue is a flimsy excuse to raise US tariffs on Chinese imports. Our countermeasures to defend our rights and interests are fully legitimate and necessary". 

"The US, not anyone else, is responsible for the fentanyl crisis inside the US In the spirit of humanity and goodwill towards the American people, we have taken robust steps to assist the US in dealing with the issue. Instead of recognising our efforts, the US has sought to smear and shift blame to China, and is seeking to pressure and blackmail China with tariff hikes," it wrote. 

China is also looking for progress as it ambitiously set an annual growth target of around 5% on Wednesday, vowing to make domestic demand its main economic driver as an escalating trade war with the United States hit exports.

Beijing also announced a rare hike in fiscal funding, allowing its budget deficit to reach four percent this year as it battles stuttering employment for young people, stubbornly low consumer demand and a persistent property sector debt crisis.

The headline growth figure announced by Premier Li Qiang at an annual Communist Party conclave was broadly in line with an AFP survey of analysts, although experts say it is ambitious considering the scale of China's economic challenges.

Some 12 million new jobs will be created in Chinese cities under the plans as Beijing pushes for 2% inflation this year.

A government work report vowed to make domestic demand the "main engine and anchor" of growth, adding that Beijing should "move faster to address inadequate domestic demand, particularly insufficient consumption".

And in a rare move, Li said China would hike its fiscal deficit by one percentage point — its highest level in well over a decade — which analysts have said will give Beijing more latitude to tackle its economic slowdown.

The growth target will be "tough but possible", said Dylan Loh, an assistant professor at Singapore's Nanyang Technological University.

He said low consumption was a "confidence issue", adding that "if people are, in their own calculations, worried about spending — especially on big-ticket items — it is far harder to address".

Another analyst said Beijing's policies were not yet "big enough to drive up the consumer sentiment really significantly".

"We need to see a very broad-based recovery of employment, income as well as the property market before we can really see a change in consumption patterns and retail sales trend," Yue Su, Principal Economist at The Economist Intelligence Unit, told AFP.

"Internationally, changes unseen in a century are unfolding across the world at a faster pace," the government work report said.

"Unilateralism and protectionism are on the rise," it warned.

"Domestically, the foundation for China's sustained economic recovery and growth is not strong enough," the report said.